In the late 1960's, several students at Yale University heard about a program in England that offered special care for people diagnosed with an irreversible illness. The students invited Dr. Cicely Saunders, founder of St. Christopher's Hospice in London, to speak at Yale, and were subsequently inspired to open such a place here in the United States. These students developed, and eventually launched, the hospice movement in the United States. In 1974, a Connecticut Hospice nurse and volunteer made their first Hospice Home Care visit to the home of a terminally ill patient.

A book based on more than 500 interviews with dying patients was published in 1969, titled On Death and Dying. Written by Dr. Elisabeth Kubler-Ross, it identified the five stages through which many terminally ill patients progress. The book became an internationally known best seller. In it Kubler-Ross made a plea for home care as opposed to treatment in an institutional setting and argued that patients should have a choice and the ability to participate in the decisions that affect their destiny.

In 1982 The United States Congress included a provision to create a Medicare hospice benefit in the Tax Equity and Fiscal Responsibility Act of 1982, with a 1986 sunset provision. Congress was concerned about cost containment and included a cap on both overall annual aggregate per-patient expenses and inpatient hospital utilization. The Health Care Financing Administration (HCFA, now know as Centers For Medicare and Medicaid Services or CMS) created a prospective daily reimbursement system for the Medicare Hospice Benefit.

In 1986, The Medicare Hospice Benefit was made permanent by Congress and the States were given the option of including hospice in their Medicaid programs.

Today, estimates indicate that there are 3,200 operational hospice programs in the U.S., including the District of Columbia, the Commonwealth of Puerto Rico and the Territory of Guam. Hospices admitted approximately 775,000 patients in 2001.